Still facing the fallout from the sub-prime meltdown, the firm slashes pay for 60,900 employees
Bloomberg 5 hours, 20 minutes ago
(Newser)
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Merrill Lynch, facing losses of $13.3 billion this year and with revenues off 96% from a year ago, will slash year-end bonuses at least 50%, Bloomberg reports. Some employees may face steeper cuts. Merrill and Bank of America, which agreed to acquire the failing investment bank earlier this year, received $25 billion from the federal rescue fund.
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ANALYSIS
Successor for Treasury Secretary a major question in bailout debate
Washington Post Sep 25, 08 11:43 AM CDT
(Newser)
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With the Treasury Secretary looking to get $700 billion to spend on the bailout, Washington is starting to focus on who might replace Henry Paulson when a new administration takes over in January, the Post reports. Neither candidate has given in to requests for names, but speculation has centered on Timothy Geithner for Barack Obama and John Thain for John McCain.
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Wall Street Journal Sep 19, 08 9:41 AM CDT
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The financial world has been rocked to its foundations in a few short days, with a handful of men making momentous decisions. The Wall Street Journal outlines the key players. Henry Paulson. No Treasury chief has wielded such power. He decides whether big firms live or die via federal bailouts. Will his too-big-to-fail philosophy stand the test of time? John Thain. The Merrill Lynch CEO saw the writing on the wall for his own firm while working on the Lehman crisis. In less than 24 hours, he hammered out a deal to sell Merrill to Bank of America.
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ANALYSIS
CEO proved wiser than Wall St. colleagues,
has $50B to show for it
Slate Sep 16, 08 2:34 PM CDT
(Newser)
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As the credit market self-destructed, Merrill Lynch and Lehman Brothers faced similar problems. The difference, Henry Blodget writes in Slate, is that Merrill’s John Thain played his cards right, and Lehman’s Dick Fuld didn’t. Brought in to clean house after Stan O’Neal’s high-risk strategy exploded, Thain immediately cleaned up the balance sheet. Making the best of bad options netted shareholders $50 billion.
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Settlement reached after auction-rate securities market collapse
Financial Times (UK) Aug 22, 08 2:23 AM CDT
(Newser)
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Merrill Lynch, Goldman Sachs and Deutsche Bank have agreed to a settlement with New York's attorney general and other state regulators to buy back $14.5 billion of now worthless auction-rate securities. The brokerages will also pay $162 million in fines to settle charges that they misled investors into thinking the securities were as liquid as cash, reports the Financial Times .
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analysis
Once regaled for cavalier confidence, CEO's chief cuts losses
New York Times Aug 1, 08 10:30 AM CDT
(Newser)
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Merrill Lynch CEO John Thain has seen better days, Floyd Norris writes in the New York Times . He's gone from “cockiness to capitulation. Distinction to desperation.” Thain recently unloaded a bundle of his company’s securities for 22 cents on the dollar and raised $8.5 billion from a stock sale. But this uncharacteristic fear could indicate that Wall Street has finally hit bottom.
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$9B in writedowns
guts brokerage's earnings
Wall Street Journal Apr 17, 08 7:25 AM CDT
(Newser)
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Merrill Lynch today posted nearly $2 billion in losses in the first quarter, after taking another $9 billion in writeoffs, the Wall Street Journal reports. In its third straight quarterly loss, Merrill was in the red $1.96 billion, or $2.19 a share, compared to earning $2.16 billion, or $2.26 a share a year ago. The company said it will cut about 3,000 jobs.
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Subprime woes mean unprecedented third consecutive losing quarter for brokerage
Wall Street Journal Apr 16, 08 10:28 AM CDT
(Newser)
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Merrill Lynch is likely to report another $6 billion to $8 billion in writedowns related to the subprime collapse tomorrow, leading to a third consecutive quarterly loss, the Wall Street Journal reports. Merrill’s chronic mortgage losses—$30 billion and counting—show just how deep the world's largest brokerage is mired in the mess, and have it slashing costs and jobs.
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Co-president will step down in wake of huge subprime losses
Bloomberg Jan 28, 08 3:55 PM CST
(Newser)
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Merrill Lynch co-president Ahmass Fakahany will step down after subprime mortgages led to a $9.8 billion fourth-quarter loss, the firm said today. Fakahany is at least the third exec from Stan O'Neal's team to leave since John Thain took over as CEO, reports Bloomberg. Thain replaced O'Neal in October following almost-as-horrifying third-quarter losses.
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IMF head foresees widespread slowdown, backs US stimulus
Financial Times (UK) Jan 28, 08 10:55 AM CST
(Newser)
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With a global recession looming, the head of the IMF has warned bankers meeting in Davos, Switzerland, that lower interest rates alone won’t avert a crisis, the Financial Times reports. Dominique Strauss-Kahn called on governments to follow the US in easing fiscal policies, reversing a quarter-century of emphasis on tight spending. IMF forecasts due this week show a “serious slowdown” globally, he said.
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Latest loss, driven by mortgage woes, dwarfs original figure
New York Times Jan 11, 08 1:10 PM CST
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Merrill Lynch will announce $15 billion in losses stemming from mortgage investments, figure twice its earlier forecast, the New York Times reports. The firm is expected to raise $4 billion quickly from outside investors. New CEO John Thain, who has already sold a $5.6 billion stake to a Singapore state company, is considering selling off its $4 billion holdings in Bloomberg.
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Iconic backdrop 'dead'
as shares trade electronically
AFP Dec 3, 07 9:38 AM CST
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The famously frenetic NYSE trading floor is rapidly becoming history as more efficient computer trading replaces human traders. With most of the exchange's trading rooms shuttered, only two trading halls stay open to the 1,500 remaining traders, whose numbers are dwindling, AFP reports. "The floor as we knew it is dead," says one expert.
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MARKETS
Bad news doesn't halt rally; markets end week up
MarketWatch Nov 16, 07 3:44 PM CST
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The major indexes closed up today after erratic trading as bad news on industrial production and new negative forecasts failed to halt an end-of-week rally. The Dow gained 66.74 to 13,176.79, the Nasdaq climbed 18.73 to 2,637.24, and the S&P 500 closed at 1,458.74, up 7.59.
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Chosen for steady hand in unsteady times
Wall Street Journal Nov 15, 07 4:24 AM CST
(Newser)
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The choice of NYSE's John Thain as Merrill Lynch's new CEO signals a focus on a new kind of manager for the financial giant, the Wall Street Journal observes: a strong risk manager. A low-key, detail-oriented veteran, Thain resembles the top execs of the firms least damaged by the subprime mortgage collapse, the paper notes: "They aren't risk-averse but they have a deep understanding of risk and have the battle scars to prove it."
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Current COO has been with NYSE only a few months
Wall Street Journal Nov 14, 07 4:06 PM CST
(Newser)
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Duncan Niederaurer, current co-COO and president of the New York Stock Exchange, is poised to replace John Thain as CEO of the Big Board, reports the Wall Street Journal . Thain is expected to be named CEO of Merrill Lynch, replacing the departing Stan O'Neal. NYSE is expected to make an announcement later today.
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